Compound Interest Calculator

What this estimate assumes

• Interest compounds monthly at a constant annual rate, and contributions are added at the end of each month.
• Real markets don't return the same rate every year — this shows a smooth projection, not a guarantee. It also doesn't account for taxes, fees, or inflation.

How to use this calculator

1. In Starting amount ($), enter whatever you already have saved or invested today. If you're starting from scratch, leave it at 0.
2. In Monthly contribution ($), enter how much you plan to add every month going forward. Set it to 0 if you just want to see a lump sum grow on its own.
3. In Estimated annual return (%), enter the average yearly growth rate you expect before taxes and fees. 7% is a commonly used long-run estimate for a diversified stock index fund; a high-yield savings account or CD would be closer to 4-5%.
4. In Years, enter how many years you want to project forward.
5. Click Project growth. The result shows your projected ending balance, splits it into how much came from your own contributions versus investment growth, and gives you a year-by-year table and bar chart.
6. Change one field at a time — try raising the monthly contribution by $50 or extending the timeline by 5 years — to see which lever actually moves your ending balance the most.

Worked example

Suppose you start with $5,000, add $200 a month, expect a 7% annual return, and project out 20 years — the default values this calculator opens with.

The calculator converts the 7% annual rate into a monthly rate: 0.07 ÷ 12 ≈ 0.0058333. Over 20 years that's 240 monthly compounding periods. Growing by that monthly rate 240 times multiplies your money by roughly (1.0058333)^240 ≈ 4.04×.

Your starting $5,000 alone grows to about 5,000 × 4.04 ≈ $20,200. Your monthly $200 contributions, each compounding for whatever time is left in the 20 years, add up to roughly another $104,200 on top of that (this comes from the standard "future value of a series" math, which weights contributions made early far more heavily than contributions made near the end). Add those two pieces together and your projected balance after 20 years comes out to roughly $124,400.

Of that total, you actually put in $5,000 + ($200 × 240 months) = $5,000 + $48,000 = $53,000 of your own money. The remaining roughly $71,400 is pure compound growth — money your money earned on its own. These figures are rounded by hand to illustrate the mechanics; the calculator above computes the same formula to the cent, so if you plug in these exact numbers your result will be precise rather than "roughly."

Frequently asked questions

Does the 7% default return mean I'm guaranteed that return?

No. 7% is just a commonly cited long-run average for a diversified U.S. stock index fund — real returns swing a lot from year to year, including years with losses. Try the calculator at a lower rate, like 5%, and a higher one, like 9%, to see a realistic range instead of relying on one number.

Why is my ending balance so much higher than what I actually contributed?

Because compounding means your earlier growth starts earning growth of its own. In the worked example above, $53,000 of real contributions turns into roughly $124,400 — the extra $71,400 isn't new money you added, it's investment growth compounding on itself for 20 years, with most of the gain concentrated in the later years.

Does this calculator account for taxes, fees, or inflation?

No, it projects a clean compounding curve on exactly the numbers you enter. In a taxable account, taxes on gains or dividends would reduce your real-world total, a fund's annual expense ratio would quietly shave off a bit more each year, and inflation means a dollar 20 years from now won't buy as much as a dollar today. If you want a rough after-cost, after-inflation estimate, try lowering the "estimated annual return" by a point or two.

What happens if I set the monthly contribution to $0?

The calculator still compounds your starting amount over the time period and rate you entered — you'll see pure compound growth on a single lump sum, with nothing added along the way.

Why does starting early seem to matter more than how much I contribute?

Each contribution only compounds for the years remaining after you make it. A $200 contribution made in year 1 has nearly 20 years to grow; the same $200 contributed in year 19 has barely any time to grow at all. That's why starting small and early usually beats waiting to start with more.

Is monthly compounding realistic for how my actual investments work?

It's a reasonable approximation for most retirement and brokerage accounts, where returns accrue continuously as the market moves rather than in neat annual chunks. The compounding frequency makes a small difference compared to the annual rate and time horizon, which are the two inputs that matter most to your result.